The Fantasmic package allows you to eat one of 3 (I think) restaurants prior to the Fantasmic show and then you get "priority" seating that is reserved at the show.
We have done it and the dinner was good (a buffet at Hollywood and Vine). The food was good for the variety of adults and children we had. The "priority" seating is a little to the right of center and you still have to get in there early (we went in an hour prior to the show starting), but it was worth not waiting in the huge line outside. Our seats were good and we could see everything.
We did it again, without the dinner package, and we ended up having to get in line for the late show before the early show even started. For me, the package is worth not having to sit in a huge line of people for 2 hours.